Telecom firms are expected to begin trialing mobile money transfer from one network to the other from this month.

Safaricom said that the companies had signed the requisite agreements to set up the system called interoperability and that a pilot phase was expected in the third week of January.

“The necessary interoperability agreements have been executed between the mobile operators and at the moment, all operators are in the final stages of aligning their systems to facilitate the rollout of the service,” said Safaricom chief executive, Mr. Bob Collymore, in a statement to the Business Daily.

This is something to look up too and I think Safaricom will be the obvious winner here. They’ll be more outgoing transactions from Mpesa to other networks. At present, termination fees stand at 33bob per transaction. That is the only thing that players will drop. Other transaction charges such as sending and withdrawing will remain intact as per the companies’ prevailing charges.

He also said that the companies had agreed not to pay interconnection fees for terminating transactions on each other’s network as they do when subscribers make cross-network phone calls. Interoperability became topical and urgent with heated debate on competition in the sector last year.

Although P2P Interoperability is good for competition, there are some things that may limit its effectiveness in addressing competition issues in the short term.

Safaricom has a much bigger ecosystem in terms of agents,products and customers and that’s where the problem is. @iamtembo will throw away his Safaricom sim card and get let’s say get an Airtel line. He’ll go to shagz, someone will send money to his Airtel line. Let’s say he wants to withdraw the money. He’ll need an agent. The nearest agent will likely be an MPESA agent, not an Airtel agent. Let’s assume he doesn’t need to withdraw the money-he wants to buy something at the local supermarket. What does he find? The local supermarket only has Lipa na MPESA.

The competition really needs to work hard to build such an ecosystem(Equitel has a good chance of building such an ecosystem). Nowadays, Mobile money is not just sending and receiving money(P2P). Its a lot more… Its a savings platform, a payments platform, an international money transfer platform etc.

If interoperability was broader to include even payments,agents(this was suggested but will not be implemented), it could have been more effective.

If Airtel users can send money to Mpesa users, isn’t Airtel benefiting due to an increase in transaction numbers?

Airtel money transfers are free to any network. So how will they benefit when sending money to mpesa? Mpesa are the ones who’ll impose a withdrawal charge to that amount and benefit.

Sending money to an Airtel user will be charged like a non-registered user by Mpesa. I think those are the charges currently. I have once sent to Airtel and was charged that way by mpesa. So that will deter many from sending money to Airtel.

Trey:

I honestly think Equity Bank will be the biggest beneficiary (If they are part of this)

In essence, there are more transactions between Mpesa and Equitel than any other network/bank. So both users will enjoy less sending fees since the termination charges will be dropped. Only sending charges will remain. At least, they can apply a fixed charge or bring the charges down all together.

The communications and banking sector regulators are today set to announce the start of a pilot test of the cross-network service beginning Monday next week, before its full launch to the public later on.

The deal is between Airtel and Safaricom at the moment.

Mr. Mucheru said that although the service will be initially piloted between Airtel and Safaricom, Telkom Kenya is expected to come on board once it relaunches its mobile money services. In a statement to the Business Daily Telkom Kenya did not give a date on when it would join in the interoperability scheme.